In Trump's China Visit, Plenty Of Business Deals But Little Progress On Trade

China's President Xi Jinping speaks during a business leaders' event with President Trump in Beijing on Thursday.

Nicolas Asfouri
/ AFP/Getty Images

Engaging the Chinese on North Korea and trade were President Trump's two priorities this week in Beijing — and engage he did, but Chinese leader Xi Jinping gave little indication he was ready to budge any further on either issue.

In recent months, China has limited oil and electricity exports to Pyongyang, while severely limiting coal imports from North Korea. Xi opted to use the dreaded verb "renew" to reiterate China's stock statement on the North Korean issue: "We renewed our commitment to denuclearize the Korean peninsula and uphold international rules," he said Thursday through an interpreter.

Then came trade. On the face of it, the author of The Art of the Deal seemed to have lived up to his name in Beijing. President Trump, standing alongside Xi, watched on as a quarter-trillion dollars' worth of deals between U.S. and Chinese companies were announced Thursday.

But a closer look, reports Bloomberg News, reveals that about 15 of those deals were "mostly non-binding memorandums of understanding and could take years to materialize."

A $43 billion joint development agreement to advance a liquefied natural gas project in Alaska that involves Alaska Gasline Development Corp., Sinopec, The China Investment Corporation and the Bank of China

JD.com agreed to buy $1.2 billion-worth of beef from the Montana Stock Growers Association and pork from Smithfield Foods Inc.

The China-based executives of American multinationals that Parker represents are looking beyond a promise Trump made as part of his pledge to make America great again.

"I think one of the rationales behind President Trump's focus on the trade deficit is the idea that manufacturing in the United States has migrated abroad to Southeast Asia or to China," Parker said. "And the reality is when we talk to our member companies, they frequently tell us they're manufacturing in China to access the domestic market. Very few of them are manufacturing domestically to export abroad."

The biggest challenge American companies face in China is not the ability to make deals, says Parker, but the ability to ensure these deals are fair. U.S. businesses are often forced to hand over their key technology and enter into joint ventures with Chinese partners, and U.S. companies in at least 10 sectors have investment caps preventing them from competing with Chinese companies on a fair playing field.

Yet neither President Trump nor President Xi made detailed remarks about enacting meaningful structural changes to how China's government treats U.S. businesses this week.

"We want a vibrant trade relationship with China," said Trump while he stood beside Xi Thursday morning in the Hall of the People. "We also want a reciprocal one."

Xi responded: "Keeping opening up is our long-term strategy. We will never narrow or close our doors. We will further widen them."

The China-based U.S. business leaders on the sidelines of this week's meetings have heard these platitudes before. For years, they've waited for a U.S. administration that would pressure the Chinese government to loosen its grip on their business in China.

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President Trump and Chinese leader Xi Jinping say they have agreed to work together on the denuclearization of North Korea and closer cooperation on trade.

In a joint statement delivered at Beijing's Great Hall of the People with Xi, Trump praised the Chinese president as "a very special man," and earlier, he said the two enjoyed "great chemistry." The Chinese leader emphasized that while the two economic and military giants would occasionally have differences, there were opportunities to be "mutually reinforcing."

As the sun went down Wednesday on the vermilion walls and yellow tile roofs of Beijing's Forbidden City, the first families of the U.S. and China took in a Peking opera performance in the palace where China's emperors lived for nearly six centuries.

It was the start of what China's ambassador to the U.S. calls a "state visit plus" — a highly choreographed blend of stagecraft and statecraft, designed to highlight the evolving chemistry between Presidents Trump and Xi Jinping.

Soft lounge music pipes through the speakers as elegantly dressed shoppers peruse organic produce and meats at City'super, one of Shanghai's most upscale markets, a cross between Whole Foods and Louis Vuitton. But one look at the price of an American steak is enough to conjure a mental scratch of a needle across this soothing soundtrack: Nearly $60 for a pound of USDA Prime ribeye.

After stops in Japan and South Korea, President Trump arrived in China on Wednesday, the third of his five stops in Asia this week. He had tea and dinner, and took in some opera, with China's leader Xi Jinping. On Thursday, they will hold bilateral talks. On the table will be the trade imbalance between the countries that Trump hopes to rectify and ongoing provocations from China's intransigent neighbor, North Korea.

Even as the world — especially Asian nations — looks on, no one is watching this leg of Trump's swing through Asia with more trepidation than Taiwan.